Seven Ways to Get Your Timing Right
By Rich Harvey, Managing Director www.propertybuyer.com.au
There are many critical timing elements to buying a property. Here are seven things you should consider to ensure that the timing of your purchase moves like clockwork.
- Create your plan.
Whether you are a property investor or a home buyer you need to be clear on your objectives. Less than 3% of the population have their goals written down and even less have a time frame for these goals. Be clear on what you are seeking to achieve and when you want it. Do you want a positive cashflow property, a high capital growth property or balanced investment? Do you want to move closer to work, the beach, away from the in-laws, closer to your social networks or somewhere with a stunning view? If you are buying with a partner, make sure all stakeholders are on board with the decision making – collaborate on your preferences and be realistic with your budget!
- Understand property cycles
The property clock is at different points around Australia. Seek out the best suburbs that are at the bottom or rising sectors of the property clock. If you follow the herd mentality you will get average or below average results. If you think and act like a savvy investor, you will out-perform the market.
- Finances ready
There’s no point going property shopping without your finances in place. Get your finance broker on the job BEFORE you start searching (if you need a recommendation to a smart finance broker- just give us a call). Your goals and your budget will help you narrow down the most suitable areas for your research efforts.
- Research effectively
Research is where the bulk of your time is spent. There are two basic forms of research:
(1) Finding the right area and (2) Picking the right property within that suburb. If you are an investor, you will need to use both statistical and fundamental research to narrow down your selection from the 15,000 suburbs Australia-wide. Be careful how you interpret the statistics. Median prices can mask massive variations within a suburb. Look for areas with low vacancy rates, undergoing urban renewal or experiencing solid infrastructure investment. Seek affordable areas with broad buyer and tenant appeal, growing population and diverse employment. In summary – areas with high demand and short supply. Be aware that your research is very time sensitive. Keep notes from inspections, use checklists and ensure you look at 50+ properties in your price range.
- Ideal months to buy
While there are always opportunities to buy well, there are some months when vendors are even more motivated to accept offers. The period in Nov/ Dec just before Christmas and pre- Easter are ideal for buying property. Vendors are often more motivated to sell this time of year as they want closure. They may have had their property exposed to the market for some time and had a few offers, but realised that in order to sell, they have to “meet the market”. Some investors may wish to sell their property before December 31 as this is the date that land tax is calculated (this would actually mean you need to settle the property prior to years end).
Buyers and vendors want a resolution. Home buyers want to know where they will be living next year, and not still be sitting on the searching merry-go-round. They imagine themselves sitting around the Christmas lunch table feeling satisfied that they have purchased a new home and will be moving there in the New Year.
- Timing your offers – the art of negotiation
Negotiation is not for the faint hearted. It’s where the deals are won or lost. It’s important to understand as much as possible about the vendors motivation for selling and capitalise on this. The timing of your offer is critical. Should you go in high or low? How quickly should you make a counter offer if rejected? Each negotiation is different and will depend on the circumstances. Our clients have found that using a buyers’ advocate to do both the appraisal and the negotiation brings great results. Having an independent third party can make all the difference to a negotiation. We are not emotionally involved so we end up securing the property at the best possible price.
- Closing the deal
If ever there was a more critical event in the process of buying property it is at the point of “exchange”. My advice here is move quickly. Sometimes you can be in a “race to exchange” with another buyer if you have located a gem. Get your solicitor/ conveyancer engaged early to review the contract. Should you do the pest and building inspection (or strata) during a 5 day cool off or is it better done prior to a 66W? If you have “offer and acceptance” then this means nothing until the property contract is formally exchanged. There is an optimal point at around the third week in a 4 week auction campaign to make offers and secure before auction. The vendor will want to have “tested” the market, but they won’t want a failed auction either.
Of course there is an even easier way to buy property and with time efficiency – and that’s using one of our savvy Buyers’ Advocates. They know the tricks of the trade to help you secure the ideal property and work on your side each step of the way. Using a Buyers’ Agent is the key to making smarter buying decisions.
This article was written by Rich Harvey, founder and Managing Director of propertybuyer ®, Australia’s most awarded Buyers Advocates. Propertybuyer helps property investors and home buyers search and negotiate the right property at the right price, everytime.
Visit https://www.propertybuyer.com.au/ or call +61 2 9975 3311
Disclaimer: while due care is taken, the viewpoints expressed by sponsors do not necessarily reflect the opinions of Your Investment Property.
